87 FR 202 pgs. 63760-63762 - Aviastar—TU, 5 b. 7 Leningradsky prospekt g. Moskva, 125040, Moscow, Russia; Order Renewing Temporary Denial of Export Privileges
Type: NOTICEVolume: 87Number: 202Pages: 63760 - 63762
Pages: 63760, 63761, 63762FR document: [FR Doc. 2022-22815 Filed 10-19-22; 8:45 am]
Agency: Commerce Department
Sub Agency: Industry and Security Bureau
Official PDF Version: PDF Version
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DEPARTMENT OF COMMERCE
Bureau of Industry and Security
Aviastar-TU, 5 b. 7 Leningradsky prospekt g. Moskva, 125040, Moscow, Russia; Order Renewing Temporary Denial of Export Privileges
Pursuant to section 766.24 of the Export Administration Regulations, 15 CRR parts 730-774 (2021) ("EAR" or "the Regulations"), 1 I hereby grant the request of the Office of Export Enforcement ("OEE") to renew the temporary denial order ("TDO") issued in this matter on April 21, 2022. I find that renewal of this order is necessary in the public interest to prevent an imminent violation of the Regulations.
Footnotes:
1 ?On August 13, 2018, the President signed into law the John S. McCain National Defense Authorization Act for Fiscal Year 2019, which includes the Export Control Reform Act of 2018, 50 U.S.C. 4801-4852 ("ECRA"). While section 1766 of ECRA repeals the provisions of the Export Administration Act, 50 U.S.C. app. 2401 et seq. ("EAA"), (except for three sections which are inapplicable here), Section 1768 of ECRA provides, in pertinent part, that all orders, rules, regulations, and other forms of administrative action that were made or issued under the EAA, including as continued in effect pursuant to to the International Emergency Economic Powers Act, 50 U.S.C. 1701 et seq. ("IEEPA"), and were in effect as of ECRA's date of enactment (August 13, 2018), shall continue in effect according to their terms until modified, superseded, set aside, or revoked through action undertaken pursuant to the authority provided under ECRA. Moreover, Section 1761(a)(5) of ECRA authorizes the issuance of temporary denial orders. 50 U.S.C. 4820(a)(5).
I. Procedural History
On April 21, 2022, I signed an order denying Aviastar-TU's ("Aviastar") export privileges for a period of 180 days on the ground that issuance of the order was necessary in the public interest to prevent an imminent violation of the Regulations. The order was issued ex parte pursuant to section 766.24(a) of the Regulations and was effective upon issuance. 2
Footnotes:
2 ?The TDO was published in the Federal Register on April 26, 2022 (87 FR 24514).
On September 13, 2022, BIS, through OEE, submitted a written request for renewal of the TDO that issued on April 21, 2022. The written request was made more than 20 days before the TDO's scheduled expiration. A copy of the renewal request was sent to Aviastar in accordance with sections 766.5 and 766.24(d) of the Regulations. No opposition to the renewal of the TDO has been received.
II. Renewal of the TDO
A. Legal Standard
Pursuant to section 766.24, BIS may issue an order temporarily denying a respondent's export privileges upon a showing that the order is necessary in the public interest to prevent an "imminent violation" of the Regulations, or any order, license or authorization issued thereunder. 15 CFR 766.24(b)(1) and 766.24(d). "A violation may be `imminent' either in time or degree of likelihood." 15 CFR 766.24(b)(3). BIS may show "either that a violation is about to occur, or that the general circumstances of the matter under investigation or case under criminal or administrative charges demonstrate a likelihood of future violations." Id. As to the likelihood of future violations, BIS may show that the violation under investigation or charge "is significant, deliberate, covert and/or likely to occur again, rather than technical or negligent[.]" Id. A "lack of information establishing the precise time a violation may occur does not preclude a finding that a violation is imminent, so long as there is sufficient reason to believe the likelihood of a violation." Id.
B. The TDO and BIS's Request for Renewal
The U.S. Commerce Department, through BIS, responded to the Russian Federation's ("Russia's") further invasion of Ukraine by implementing a sweeping series of stringent export controls that severely restrict Russia's access to technologies and other items that it needs to sustain its aggressive military capabilities. These controls primarily target Russia's defense, aerospace, and maritime sectors and are intended to cut off Russia's access to vital technological inputs, atrophy key sectors of its industrial base, and undercut Russia's strategic ambitions to exert influence on the world stage. Effective February 24, 2022, BIS imposed expansive controls on aviation-related ( e.g., Commerce Control List Categories 7 and 9) items to Russia, including a license requirement for the export, reexport or transfer (in-country) to Russia of any aircraft or aircraft parts specified in Export Control Classification Number (ECCN) 9A991 (section 746.8(a)(1) of the EAR). 3 BIS will review any export or reexport license applications for such items under a policy of denial. See section 746.8(b). Effective March 2, 2022, BIS excluded any aircraft registered in, owned, or controlled by, or under charter or lease by Russia or a national of Russia from being eligible for license exception Aircraft, Vessels, and Spacecraft (AVS) (section 740.15 of the EAR). 4 Accordingly, any U.S.-origin aircraft or foreign aircraft that includes more than 25% controlled U.S.-origin content, and that is registered in, owned, or controlled by, or under charter or lease by Russia or a national of Russia, is subject to a license requirement before it can travel to Russia.
Footnotes:
3 ?87 FR 12226 (Mar. 3, 2022). Additionally, BIS published a final rule effective April 8, 2022, which imposed licensing requirements on items controlled on the Commerce Control List ("CCL") under Categories 0-2 that are destined for Russia or Belarus. Accordingly, now all CCL items require export, reexport, and transfer (in-country) licenses if destined for or within Russia or Belarus. 87 FR 22130 (Apr. 14, 2022).
4 ?87 FR 13048 (Mar. 8, 2022).
OEE's request for renewal is based upon the facts underlying the issuance of the initial TDO and the evidence developed over the course of this investigation, which indicate a blatant disregard for U.S. export controls, as well as the TDO. Specifically, the initial TDO, issued on April 21, 2022, was based on evidence that Aviastar engaged in conduct prohibited by the Regulations by operating multiple aircraft subject to the EAR and classified under ECCN 9A991.b on flights into Russia after March 2, 2022, from destinations including Hangzhou, China, Shenzhen, China, and Zhengzhou, China, without the required BIS authorization. 5
Footnotes:
5 ?Publicly available flight tracking information shows that on April 10, 2022, serial number (SN) 27054 flew from Hangzhou, China to Novosibirsk, Russia and that on April 11, 2022 and April 14, 2022, respectively, SN 25696 and SN 25731 flew from Hangzhou, China to Novosibirsk, Russia. In addition, on April 12, 2022, SN 27053 flew from Shenzhen, China to Abakan, Russia.
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In its September 13, 2022, request for renewal of the TDO, BIS has submitted evidence that Aviastar continues to operate in violation of the April 21, 2022 TDO and/or the Regulations by operating aircraft subject to the EAR and classified under ECCN 9A991.b on flights into Russia. Specifically, BIS's evidence and related investigation indicated that Aviastar has continued to operate aircraft subject to the EAR, including, but not limited to, flights into and out of Russia from/to Hangzhou, China and Zhengzhou, China, as well as on domestic flights within Russia potentially in violation of section 736.2(b)(10) of the Regulations. 6 Information about those flights includes, but is not limited to, the following:
Footnotes:
6 ?Section 736.2(b)(10) of the EAR provides: General Prohibition Ten-Proceeding with transactions with knowledge that a violation has occurred or is about to occur (Knowledge Violation to Occur). You may not sell, transfer, export, reexport, finance, order, buy, remove, conceal, store, use, loan, dispose of, transport, forward, or otherwise service, in whole or in part, any item subject to the EAR and exported or to be exported with knowledge that a violation of the Export Administration Regulations, the Export Administration Act or any order, license, License Exception, or other authorization issued thereunder has occurred, is about to occur, or is intended to occur in connection with the item. Nor may you rely upon any license or License Exception after notice to you of the suspension or revocation of that license or exception. There are no License Exceptions to this General Prohibition Ten in part 740 of the EAR. (emphasis in original).
| Tail No. | Serial No. | Aircraft Type | Departure/Arrival Cities | Dates |
|---|---|---|---|---|
| RA-73355 | 27054 | 757-223 (PCF) (B752) | Zhengzhou, CN/Novosibirsk, RU | May 22, 2022. |
| RA-73355 | 27054 | 757-223 (PCF) (B752) | Irkutsk, RU/Moscow, RU | September 25, 2022. |
| RA-73355 | 27054 | 757-223 (PCF) (B752) | Norilsk, RU/Novosibirsk, RU | September 30, 2022. |
| RA-73355 | 27054 | 757-223 (PCF) (B752) | Moscow, RU/Mirny, RU | October 4, 2022. |
| RA-73351 | 25696 | 757-223 (PCF) (B752) | Zhengzhou, CN/Novosibirsk, RU | May 24, 2022. |
| RA-73351 | 25696 | 757-223 (PCF) (B752) | Moscow, RU/Norilsk, RU | September 23, 2022. |
| RA-73351 | 25696 | 757-223 (PCF) (B752) | Moscow, RU/Norilsk, RU | September 27, 2022. |
| RA-73351 | 25696 | 757-223 (PCF) (B752) | Ulan-Ude, RU/Moscow, RU | October 1, 2022. |
| RA-73352 | 25731 | 757-223 (PCF) (B752) | Hangzhou, CN/Novosibirsk, RU | May 25, 2022. |
| RA-73352 | 25731 | 757-223 (PCF) (B752) | Irkutsk, RU/Moscow, RU | September 22, 2022. |
| RA-73352 | 25731 | 757-223 (PCF) (B752) | Moscow, RU/Norilsk, RU | October 1, 2022. |
| RA-73352 | 25731 | 757-223 (PCF) (B752) | Moscow, RU/Norilsk, RU | October 7, 2022. |
| RA-73354 | 27053 | 757-223 (PCF) (B752) | Hangzhou, CN/Novosibirsk, RU | May 25, 2022. |
| RA-73354 | 27053 | 757-223 (PCF) (B752) | Moscow, RU/Norilsk, RU | September 28, 2022. |
| RA-73354 | 27053 | 757-223 (PCF) (B752) | Moscow, RU/Novosibirsk, RU | September 30, 2022. |
| RA-73354 | 27053 | 757-223 (PCF) (B752) | Moscow, RU/Mirny, RU | October 7, 2022. |
III. Findings
Under the applicable standard set forth in section 766.24 of the Regulations and my review of the entire record, I find that the evidence presented by BIS convincingly demonstrates that Aviastar has acted in violation of the Regulations and the TDO; that such violations have been significant, deliberate and covert; and that given the foregoing and the nature of the matters under investigation, there is a likelihood of imminent violations. Therefore, renewal of the TDO is necessary in the public interest to prevent imminent violation of the Regulations and to give notice to companies and individuals in the United States and abroad that they should avoid dealing with Aviastar, in connection with export and reexport transactions involving items subject to the Regulations and in connection with any other activity subject to the Regulations.
IV. Order
It is therefore ordered:
First, Aviastar-TU, 5 b. 7 Leningradsky prospekt, g. Moskva, 125040, Moscow, Russia, when acting for or on their behalf, any successors or assigns, agents, or employees may not, directly or indirectly, participate in any way in any transaction involving any commodity, software or technology (hereinafter collectively referred to as "item") exported or to be exported from the United States that is subject to the EAR, or in any other activity subject to the EAR including, but not limited to:
A. Applying for, obtaining, or using any license (except directly related to safety of flight), license exception, or export control document;
B. Carrying on negotiations concerning, or ordering, buying, receiving, using, selling, delivering, storing, disposing of, forwarding, transporting, financing, or otherwise servicing in any way, any transaction involving any item exported or to be exported from the United States that is subject to the EAR except directly related to safety of flight and authorized by BIS pursuant to section 764.3(a)(2) of the Regulations, or engaging in any other activity subject to the EAR except directly related to safety of flight and authorized by BIS pursuant to section 764.3(a)(2) of the Regulations; or
C. Benefitting in any way from any transaction involving any item exported or to be exported from the United States that is subject to the EAR, or from any other activity subject to the EAR except directly related to safety of flight and authorized by BIS pursuant to section 764.3(a)(2) of the Regulations.
Second, that no person may, directly or indirectly, do any of the following:
A. Export, reexport, or transfer (in-country) to or on behalf of Aviastar any item subject to the EAR except directly related to safety of flight and authorized by BIS pursuant to section 764.3(a)(2) of the Regulations;
B. Take any action that facilitates the acquisition or attempted acquisition by Aviastar of the ownership, possession, or control of any item subject to the EAR that has been or will be exported from the United States, including financing or other support activities related to a transaction whereby Aviastar acquires or attempts to acquire such ownership, possession or control except directly related to safety of flight and authorized by BIS pursuant to section 764.3(a)(2) of the Regulations;
C. Take any action to acquire from or to facilitate the acquisition or attempted acquisition from Aviastar of any item subject to the EAR that has been exported from the United States except directly related to safety of flight and authorized by BIS pursuant to section 764.3(a)(2) of the Regulations;
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E. Engage in any transaction to service any item subject to the EAR that has been or will be exported from the United States and which is owned, possessed or controlled by Aviastar, or service any item, of whatever origin, that is owned, possessed or controlled by Aviastar if such service involves the use of any item subject to the EAR that has been or will be exported from the United States except directly related to safety of flight and authorized by BIS pursuant to section 764.3(a)(2) of the Regulations. For purposes of this paragraph, servicing means installation, maintenance, repair, modification, or testing.
Third, that, after notice and opportunity for comment as provided in section 766.23 of the EAR, any other person, firm, corporation, or business organization related to Aviastar by ownership, control, position of responsibility, affiliation, or other connection in the conduct of trade or business may also be made subject to the provisions of this Order.
In accordance with the provisions of sections 766.24(e) of the EAR, Aviastar may, at any time, appeal this Order by filing a full written statement in support of the appeal with the Office of the Administrative Law Judge, U.S. Coast Guard ALJ Docketing Center, 40 South Gay Street, Baltimore, Maryland 21202-4022.
In accordance with the provisions of section 766.24(d) of the EAR, BIS may seek renewal of this Order by filing a written request not later than 20 days before the expiration date. A renewal request may be opposed by Aviastar as provided in section 766.24(d), by filing a written submission with the Assistant Secretary of Commerce for Export Enforcement, which must be received not later than seven days before the expiration date of the Order.
A copy of this Order shall be provided to Aviastar, and shall be published in the Federal Register .
This Order is effective immediately and shall remain in effect for 180 days.
Matthew S. Axelrod,
Assistant Secretary of Commerce for Export Enforcement.
[FR Doc. 2022-22815 Filed 10-19-22; 8:45 am]
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